Want to Steal Customers from the Competition? Here’s the Loyalty Program Playbook (Backed by Science, Not BS)

Look, we all love the idea of a loyalty program. “Get your 10th coffee free!” Adorable. But let’s be real: for most small and medium-sized businesses, the thought of setting one up feels like trying to install a ceiling fan in the dark. Blindfolded. With your in-laws watching.

But here's the thing: a new study by Taylor and Hollenbeck (2021) just gave us a giant, flashing neon sign that says: "Loyalty programs work... when you use them to steal."

The TL;DR

These researchers got their hands on spending data from a massive U.S. retailer. We're talking millions of transactions, 10,000+ customers, and GPS-level detail on where everyone shops. It’s like they were tracking customer migration patterns like David Attenborough in the wild.

What did they find? Loyalty programs aren’t magic fairy dust—they’re tactical weapons. They don’t make people spend more in general. They just make people spend more with you instead of that smug jerk down the street.

Customers near competing stores were way more likely to shift their spending habits once a loyalty program kicked in. Customers in the middle of nowhere? Not so much. They just took the discount and kept doing what they were doing. Can’t blame ‘em.

Why This Matters for You (Yes, You)

If you’re running a business and thinking, “Eh, loyalty programs are for chains,” stop it. That mindset is how you lose. Because if you’ve got competition, and you’re not locking in customers with rewards, you’re just handing them over on a silver platter.

But here’s the beauty of it: you don’t need a PhD or a million-dollar tech team to do this right. That’s what VivaPoints is here for. We make it dead simple for small and medium-sized businesses to give loyalty points, track them, and actually use them to grow.

Think of us as the loyalty laser-sword you never knew you had. We help you:

• Reward the right customers (not the freeloaders)
• Target the ones who are this close to switching to your competitor
• Keep ‘em coming back without slashing your margins

And hey, if your shop is the only one within 20 miles, congrats—you probably don’t need a loyalty program. You’re already the king of the hill. But for the rest of us, in the trenches of local competition? A smart loyalty program isn’t just nice to have—it’s how you win.

Final Thought

This isn’t about handing out discounts like candy. It’s about strategy. Retention. And most importantly, domination (the nice kind). So if you’ve got a rival business in your orbit, it’s time to stop playing nice.

VivaPoints gives you the tools. You bring the ambition. Let’s steal some market share, shall we?

References:

Taylor, W., & Hollenbeck, B. (2021). Leveraging Loyalty Programs Using Competitor Based Targeting. UCLA Anderson School of Management and Southern Methodist University.
https://ssrn.com/abstract=3353432